Being a bookmaker is quite tough these days. Not only is there lots of competition, but the government is looking to clamp down on the industry. To survive and thrive in this environment you have to be good at keeping your customers happy. William Hill (LSE: WMH)looks like it is doing lots of things right.
This week's trading update revealed that the business isdoing very nicely. Sports betting boosted by the WorldCup has been very kind to William Hill.
The profits of the online business have more than doubled compared tolast year, while high-street profits rose by nearly a third. Overseas ventures in Australia and Italy are also doing well. The company now expects profits for 2014 to be at the top endof City analysts' expectations.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
One of the things I like about William Hill is its ability togenerate lots of cash. As a result, net debt fell by nearly aquarter last year and we may see a nice dividend increase.I tipped the shares as a buy' back in July at 335p.
At 363p theyhave performed quite well in a difficult stockmarket. They arenot that expensive on 12 times forecast earnings, but I probablywouldn't chase them now.
Verdict: a solid hold
-
Three companies that dominate their markets with critical productsA professional investor tells us where he’d put his money. This week: Charlie Huggins, manager of Wealth Club’s Quality Shares Portfolio, picks three stocks.
-
Should investors worry about investment trust discounts?Investment trusts tend to trade at discounts to their net asset value, but the advantages that come with them mean this matters less to some investors
-
William Hill goes all in on PokerStarsFeatures William Hill is in talks with Canada’s Amaya, owner of PokerStars – the world’s largest online poker business – about a £5bn merger. But is it a good idea?
-
Shares in focus: Should you take a punt on William Hill?Features Bookies William Hill is a decent business. But is it worth a flutter? Phil Oakley investigates.
